Jun 21, 2011, 8:13 AM EDT
David Stern tried after last week’s bargaining session to set Tuesday up as the big key day — it is after this session we’ll know if there will be a lockout.
But even that was Stern posturing, using some gamesmanship to put the pressure on the players. Which says everything about where we are in the negotiations. Don’t expect a major breakthrough Tuesday when owners and players meet in New York. Expect pessimism.
Stern put the pressure on the players after last week by saying that the owners made a give back — they backed off their demand for non-guaranteed contracts — and that now it is the players’ turn. He said whatever concession the players made would determine if they were on track to avoid a lockout.
But that was not a real concession by the owners last week at all — they players already have guaranteed contracts. The owners made a new demand for non-guaranteed contracts than took it off the table — things have not changed. The players refuse to see no change as a concession.
Reports have both sides close to $500 million apart right now. And there is a split in the owners, some want to drive a hard bargain, as David Aldridge explained well at NBA.com.
This new generation of NBA owners, many of whom are leveraged up to their ears and who have tens of millions of annual debt service to pay before they pay a single coach or player their gargantuan salaries, has among its ranks those who are fully ready to sacrifice all of next season if it means a sea change in the league’s financial system. The new generation didn’t pay $1 million for his franchise (like the late Abe Pollin, who bought the Baltimore Bullets in 1964), or $6 million (the late Bill Davidson, who bought the Pistons in 1974). Having been in the game for decades, the old guard was more likely to be willing to cut a deal….
“The old guys, they’d made a lot of money already,” said a longtime and former senior executive of an NBA team who’s been involved in previous collective bargaining sessions with the players. (Like just about everyone quoted in this piece, he obviously cannot be named.). Now you have guys saying ‘I’m losing money, and I have to find a way to make this team that I bought for $350 million worth $500 million.’ “
The players are not going to totally cave. There needs to be a middle ground.
Here is the one thing to really watch in post-meeting comments from both sides — do they talk about movement on Basketball Related Income (BRI). That is the big number, and currently 57 percent goes to the players. BRI is the money from ticket sales, national television contracts, local television contracts, parking, concessions, a piece of luxury boxes, and so on. Basically everything.
That is the number that matters. Everything else — like a hard cap or soft cap — serves the BRI. Until the two sides decide how the pie is split, not much else matters. That and the hard cap are the keys.
Personally, I’d like them to use Aldridge’s suggestions as a jumping off point to speed up discussions (a 50/50 BRI split, a soft cap but with far few exceptions, more revenue sharing between owners, ad more). Not going to happen, but it would at least move things along.
Instead, we are headed for a lockout and the only question is how long it will last.